Today we are going to talk about a PPM or a private placement memorandum. It is a long legal document usually 100+ pages that can be overwhelming to a first-time investor. The PPM is broken down into five sections.
The first section is the about section which refers to what the investment is all about including what we are investing in, background on the company and their experience.
The second section is a healthy section on risks. The third section is the partnership agreement which is the agreement between you the investor and the sponsor or general partner. You will want to review this agreement and make sure that you are comfortable with the terms of the agreement.
The next section is the investment summary. The title of this section speaks for itself. The last section is the subscription agreement which is the part of the agreement that you sign. This section states how many units you are purchasing, what your investment amount is, the address you want your financial distributions sent to, as well as the instructions on where to send your initial investment.
This is a high-level overview of the private placement memorandum. There are several other items that you should consider which I talk about in today’s video, so be sure to watch the video below:
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